When I sell online, do I need to pay taxes?
Generally yes....the liability depends on where you are and subject to what local state and federal jurisdictions apply.You probably have to collect and pay sales tax for consumers buying goods shipped to same state as you. Depending on sales you might have to collect sales tax for buyers outside your state.You merchant services processor will likely report gross receipts or your total sales as if it were income subject to certain thresholds so it will be in your best interest to keep good records and file you taxes so you are only paying tax on profits.Even if your sales are not reported you are required to pay taxes on income sources
Paying taxes for selling fish online?
I keep tropical fish as a hobby and was wondering how you would pay taxes on fish that you sell. I plan to sell online and ship to the buyer. How would I pay the taxes? Monthly or at the end of the year when I file for income tax? I know I will not need a business license or permit as I plan to only sell my fish offspring and it will not be my main income. I keep some expensive fish so their offspring will also be expensive. For example, I plan to sell some zebra plecos (L046). A group usually goes for over $300 so if I sell 2 groups, making $600 that month, then $100 or so the other months for other fishes I keep, how would I file my taxes (monthly or at the end of the year; income tax filing)? I guess it's like selling on Ebay where you would sell stuff you don't need anymore without starting a business.
Do I need to collect sales tax/file taxes if I sell clothes online?
Being "more of an online yard sale is not grounds to exempt you from sales tax, because technically garage sales are not exempt from sales tax (as a practical matter, almost no one ever bothers with tax at garage sales, but they should, because being a garage sale is not grounds to be exempt). How you sell the items (storenvy, facebook, or physical store) does not matter. If you sell the items for more than they cost you, then you must file and pay income tax. If you sell the items for less than they cost you (or the same amount), then you do not have to file and pay income tax.
Selling stuff online on big cartel and etsy. Taxes?
If that's your only income, only joint income if you're married, and you don't file a return for any reason, then no you don't have any federal tax if you make under $400, and don't have to file. If you make over $400, or are filing a return for any other reason including a joint return, this income is reported on schedule C or C-EZ, you also use schedule SE, and for your main form you use 1040, not 1040A or EZ. Laws for state tax vary.
Do I need a license/permit to sell online in Texas?
You don't need a permit for this, but you will need to get a sales and use tax license. You will have to collect sales tax only on items you sell to TX residents; items sold to out of state customers are excluded (technically, those customers are responsible for then sending in the local sales tax to their state, but no one ever does that and it isn't enforced). With this low a sales amount, it is not likely they will require you to pay a deposit or get a sales tax bond. Also you might qualify for quarterly or annual reporting instead of monthly. The tax filing is very simple, it is a short and easy form. Basically, how much did you sell in the period covered? How much of that was taxable in TX? Multiply that number by your tax jurisidictions (you can find this info by zip code at the state comptroller's site) and that is the amount of the check you send in to the state. For example, if you sell 3,000 in a quarter and 1,000 of that is to TX residents, and you are in the highest tax area of 8.25%, you would send in the return with a check for 82.50. All of your income from this will be taxed for federal income taxes. When you do your annual return, you will fill out schedule C. This is where you show how much money you made from this business last year, deduct your costs (materials, shipping, just about any true, legitimate expense involved in getting these things sold and delivered to customers), deduct the sales taxes you paid to the state, and whatever is left over (if anything) is your profit. That goes on to your 1040 and is taxed along with your regular job income. Because your employer will not be witholding income taxes from this business, you will be required to make quarterly deposits to the IRS of your estimated tax liability. Check out the IRS web site for form 1040-ES. It is very simple to complete and will prevent you from getting a penalty at the end of the year if you end up owing 1,000 or more above what was withheld from your regular takehome pay. If you are a sole proprietor, you are not subject to the TX franchise tax (basically a corporate income tax). If you set up an LLC to benefit from federal tax provisions, you will become subject to the franchise tax. This all may sound daunting, but it isn't terribly complicated and at the volume you are estimating you will not have a large amount of taxation.